Thesis (Master in Management) -- University of the Philippines Mindanao, 2023

NCCC Rewards aims to be a sustainable entity that provides reliable information for NCCC Business Units in their planning and execution of well-targeted and effective marketing initiatives. Primarily the gatekeeper of all customer profile information, NCCC rewards functions as a loyalty program that supports the NCCC Business Units in growing their business by making sure they gather enough customer information that enables the business units to create partnerships with fast-moving consumer goods (FMCG) companies. Promotions are planned and executed out of these collaborative efforts. Their sustainability relies on their capability to build and maintain usage of the rewards Card and in increasing the renewal ration of members. They are also expected to operate efficiently and profitability since it needs to manage the marketing fund and efficiently use company resources. Set up in 1995 with only 2000 members, Rewards grew it membership base and it now caters to 742,842 members in the Davao Region and 29, 897 members in Puerto Prinsesa. These members comprise 13% and 9% of the population of the Davao Region and Puerto Prinsesa respectively. NCCC Rewards considers this as one of its assets. In the past three years, there has been a decline in its members’ card usage and renewal despite the growth in sales experienced by the business units. This threatened its capability to match the data that the business units need to develop initiatives that are based on customer preferences. There were also profitability problems in the past five years of operations. These losses were incurred due to poorly planned service contracts with a service provider. There is also a need to address the organizational structure of NCCC Rewards to address problems with overlapping roles unclear deliverables that have led to poor coordination among employees and inefficient use of company resources. Using Fred David’s Strategic Framework (David, 2002). The organization did a reassessment of the internal and external factors of the environment. This assessment led the organization to realize that their database was their biggest asset, but because of their unorganized structure, this has further led to decline in new membership and renewals. Following the framework, it also came up with a revised vision and mission statements to align the role of Rewards to the overall objectives of the organization. The course of action that can be explored are Related Diversification, Product Development, Market Development and Organizational Redesign. This strategic plan proposes for NCCC Rewards to formalize its structure by redesigning the organization. This is expected to lessen risk of weaknesses brought about by undefined roles and inconsistent leadership. It further proposes to pursue Product Development project that will contribute to the achievement of Operational, Financial and Marketing goals. Operational goals will ensure sustainability by increasing card usage by 10% and membership renewal ratio by 25% in 2025. Financial goals will support profitability by increasing sales by 10% annually while bringing down cost by 20% starting 2024. Marketing will ensure that expenses for promotions will be managed with Rewards spending only five percent of sales for the said purpose. If the proposed strategy is implemented, net income ratio can be expected to increase from 1.31% to 41.03%. there will also be reduction in cost of sales from 51% to 21.44%. the initiatives on the elimination of costs related to POS machine rental, increase in sales and management of marketing expenses are expected to drive the improvement of its financial performance